PRIMER: What is State Issue One?

Apr. 13, 2014

People drive by construction signs April 4 near the intersection of Memorial Drive and West Main Street in Lancaster. Main Street is set to close April 7 from Memorial Drive to High Street for construction. Issue One would help fund such projects through general obligation bonds. Jess Grimm/Eagle-Gazette

Advocates say State Issue One is a tax-free way to pay for improvements to local water treatment plants, such as this one in Fairfield. / The Enquirer/ Amanda Rossmann

Advocates say State Issue One is a tax-free way to pay for improvements to local water treatment plants, such as this one in Fairfield. / The Enquirer/ Amanda Rossmann

Advocates say State Issue One is a tax-free way to pay for improvements to local water treatment plants, such as this one in Fairfield. / The Enquirer/Amanda Rossmann

More

ADVERTISEMENT

State Issue One

Language: “To fund public infrastructure capital improvements by permitting the issuance of general obligation bonds”

What it would do: Reauthorize the state to issue bonds to pay for construction on local roads, bridges and water-supply systems. Voters must authorize the bonds through a constitutional amendment. Similar ballot initiatives passed in 1987, 1995 and 2005. The measure does not involve a tax increase.

What happens if it passes: Local road and water-supply construction projects would receive a 39 percent increase in state money.

The Ohio Public Works Commission currently divvies up $150 million each year to work on roads, bridges and sewers all over the state. Under the new amendment, the state would increase the size of bonds to provide more money: $175 million in each of the first five years and $200 million in each of the next five years. The state’s financial strength allows it to issue larger bonds, officials say.

Nineteen districts of cities, townships and counties around the state would decide how to use the money. Since 1987, the bonds have paid for 11,500 projects in all 88 counties. Recent projects from past allocations of state money include:

• Chillicothe received $220,000 of the $865,990 street improvement plan in 2012 from the state.

• Frankfort received a $450,000 grant and $250,000 loan for $1.8 million in waterline replacements.

• Kingston received $449,999 to help finance a $740,425 water storage tank project.

What happens if it fails: The state’s current authorization to issue bonds against the state’s tax revenue expires in 2015 or whenever the state has maxed out the amount approved in the last bond issue. Losing the ability to bond would cut off a source of money for municipal construction projects and the estimated 35,000 workers employed on the projects.

Plus, campaign spokesman Chan Cochran said, several communities have already starting planning projects that are set to receive the next round of state money if the bond issue passes.

“There’s a concern that they will have a hiccup or be suspended if the issue is turned down,” Cochran said.

Who supports it, and why: Republicans, Democrats, union members, business owners, local officials, you name it. Supporters tout the bonds that pay for the construction as a tax-free way to support upkeep on city and county roads and water systems.

“It’s an innovative way to fund public infrastructure that’s clearly badly needed, in challenging times for finding public funding,” said Republican Hamilton County Comissioner Greg Hartmann. “In challenging political times like this, it’s rare that you see an effort with such wide bipartisan support.”

Hartmann is an honorary co-chair of the campaign to pass Issue One, along with Democratic Columbus Mayor Michael Coleman and the presidents of the Ohio Chamber of Commerce and the Ohio AFL-CIO union.

When the proposal was in its early stages in the Legislature, Democrats argued the state should borrow more money to make up for cuts in other pots of state money to local governments. The Republican-sponsored proposal puts the state at a 3.5 percent debt level, compared with the constitutional limit of 5 percent of the state’s general tax revenues and lottery tax profits. But in the end, Democrats voted for the constitutional amendment.

Who opposes it, and why: No one submitted an argument to the state against the initiative. The law requires an opposition argument, so the Ohio Ballot Board, the bipartisan body that certifies ballot initiatives, wrote one.

The argument criticizes the state for increasing the amount of money it is borrowing for the projects.

“All Ohio taxpayers will be paying interest on those bonds,” the argument says. Local governments should raise money themselves for projects in their regions, it says.

Clermont County state Rep. John Becker, R-Union Township, and Rep. Ron Hood, R-Ashville, were the only two state lawmakers who voted against the measure in the General Assembly. But Becker said he’s neutral about the ballot initiative.

“It’s not that I think it’s a bad idea,” Becker said. “My issue is really that I am frustrated with the amount of spending that we are doing in Columbus. It’s a bond issue, so we’re taking on debt, and we’re spending so much in the general fund as it is. Someone’s got to say, ‘Enough is enough.’ It’s my little way of sending a message.”